European Commission plan to curb Big 4 Oligoply

It is reported that European Commission is expected to release a law, which could shake up the Big 4 audit firm's oligoply situation. Big 4 audit firms include: KPMG, Deloitte & Touche, Pricewaterhouse Coopers and Ernst & Young

It's propsing that auditors be banned from providing consulting services to firms that they audit, to avoid the conflict of interest issue. From Accounting & Auditing blog's point of view, it is mandatory to maintain independence.

The said proposed plan also includes a requirement for the companies to change auditors every 9 years. In most of the european area, change of auditors rarely occur.

It's likely that the proposed plan will open up the competition within the auditing industry.